New York: Mastercard CEO Ajay Banga speaking in New York launched into a spirited argument for turbocharging India’s productivity by bringing more women out of their homes and into the workplace and moving away from a manufacturing-led thinking on growth.

“50 per cent of India is women. Empower women. You will see India’s productivity being unlocked in a way never seen in the last 25 years”, Banga, visibly affected by the high stakes at hand, said during his fireside with NYU Stern professor of strategy Praveen Nayyar at the 6th New India lecture at the Indian Embassy in New York. Jobs and quality of life are the two things India must pursue with all the powers it can summon, Banga said as he drummed up the concept of "democratizing productivity" and how it can be done on the quick, before India's oft celebrated demographic dividend fades away. Too much emphasis on manufacturing as a vehicle to create jobs, Banga says, is deeply problematic in India's present context.

From left: Professor Praveen Nayyar and Ajay Banga at the New India lecture in NYC Monday. Picture courtesy Indian Embassy NY

Banga emphasised that these are not just politicians’ issues but for "all of us" in civil society and business to solve together. “Don’t point fingers at politicians. We have to do what we have to do as citizens. Doing well and doing good at the same time is not contradictory," Banga said during an hour long session headlined on ‘purpose driven business’.

Does purpose come first or profit? Nayyar’s big tent question to Banga took the conversation through a long bucket list of subjects intimately connected to the Indian economy as it stands today and global best practices elsehwere.

Banga spoke with great passion and nuance on the subjects of demonetisation, cash economy, financial inclusion and what he calls "democratizing productivity".

Highlights from the fireside, lightly edited for brevity, follow:

"If you can create jobs and give quality of life, that's all India needs, that's all India wants"Banga: "I think of (financial) inclusion as democratizing productivity. Whether you’re a businessman or a mother or a public sector employee, if you can create jobs and give quality of life, that’s all India wants, that's all Indians need. That requires infrastructure. Eighty per cent of India’s labour outside the agriculture sector is in the informal sector. The informal sector, by the nature of the beast, has no form of contract, of health benefits, there is no way... There is no incentive for the owner of capital to make the worker more productive because labour is cheap. If you’ve studied economics, what is GDP growth? It is the growth of labour multiplied by the growth of productivity. India has lots of labour and will have a lot of it maturing over the next 25 years but we don’t have productivity. If we don’t have productivity, you cannot GDP growth because that does not happen merely with labour growth. The way to increase productivity and the way it is currently being done - formalise the economy, so demonetisation, GST are all the right thing to do. You spend a dollar on manufacturing but you get many more jobs with the same dollar in say, tourism. Lower salaries maybe but more jobs. You’re thinking only about manufacturing...that’s one place where I differ. The manufacturing trade is a very tough place right now. Supply chains are getting disrupted. Cost of production in India is not low. It’s a hard problem to solve. India must understand that democratizing productivity cannot happen with yesterday’s rules. Yes GST, yes demonetisation but what about tourism, for instance. India gets 10 million tourists a year and the city of Paris alone gets 80 million. What does India not have to offer? There’s no point in creating Incredible India ads, change what people see when they get there!"

Profit maximisation versus purpose driven businessBanga: “If you want to run a company in today’s environment, you can’t be alone out there. It is in your own enlightened self interest to do business in a way that gives it respect and belonging in the community. If a CEO stands up and says all I care about is profit, then that company is probably not the most innovative, not the one customers and employees most care about. You need a purpose for your company. Innovation and creativity has always been there, it’s not new. Walmart founder Sam Walton’s purpose was to give products to people cheaper and by so doing, give them a better life…But yes, you cannot do good if you cannot do well ( make profits). The average life of the public company’s CEO today in the US is 4.7 years. If you’re looking only at profit maximisation, you’re not going to stick around too long”

"There isn’t enough philanthropic money in the world to solve the world’s problems. The Mastercard foundation is the second largest foundation in the world after the Bill and Melinda Gates foundation but you can put all these foundations together and still not have enough money to solve the world’s problems."

"As multinationals, we must understand we are in any country at the pleasure of that country. They want you because you bring something of value to their people and if you don’t, why would they want you there. There’s a value propostion for every stakeholder and not just consumers."

On the role of automation in business

Banga: "Even though our name is Mastercard, we don’t sell any card. We are not a B2C company, we are B2B principally. Banks sell cards, Merchants sell cards, we don’t, we just provide the technology. The issue really is that in all of this, trying to make a call on what the consumer will want in the future is not my job, that’s for the B2C company to do. My job is to facilitate their job of reaching the consumer in different ways. So my approach is don’t take winners and losers and instead find commonalities in technology that can be easily adapted which today with open APIs has become far easier. Our entire company is built on this model. You can go onto a website right now called developer.mastercard.com, and you’ll find 50 of our services. If you choose one of those, you will get a crytogram code and within 5 minutes, you are ready to go. That’s how easy it’s become today."